Shareholder involvement in CSR is gaining traction in Canada, say experts such as Jordan Berger, head of responsible investment at Mercer (Canada) Ltd. Led by pension funds, institutions and ethical mutual fund companies, shareholders are increasingly using annual meetings, proxy materials and old-fashioned public relations to nudge public companies into action over everything from environmental protection to employment practices.
"There is most definitely a rising tide of shareholder resolutions being filed," says Myrna Khan, senior vice-president and general manager of Canadian Business for Social Responsibility in Vancouver. The not-for-profit organization advises businesses
on how to bring their operations into line with CSR expectations.
The driving force, however, is not moral outrage about business practices.
Rather, today's push for social responsibility is based on hard-edged economics and long-term sustainability - the understanding that embracing high standards on the environment, employment and other social issues reduces risk and ultimately leads to improved financial returns.
"We have moved from demanding ethical investing to sustainable investing," explains Matthew Kiernan, chief executive officer of Innovest Strategic Value Advisors Inc. of Richmond Hill, Ont., which helps pension funds and institutions analyze risks associated with sustainability.